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Ministry of Economic Affairs How bits and bytes change the role of government Lunch Seminar OECD 22 September 2017 22 September 2017 Introduction I would like to discuss 3 topics in our lunch seminar today: I. The importance of

  1. Ministry of Economic Affairs How bits and bytes change the role of government Lunch Seminar OECD 22 September 2017 22 September 2017

  2. Introduction I would like to discuss 3 topics in our lunch seminar today: I. The importance of digitalisation and what it means for the role of government II. Questions around data-ownership, data-access and control III.Outlook for the Dutch economy 2 Ministry of Economic Affairs 22 September 2017

  3. Digitalisation is transforming our economy and society • Main source of innovation, productivity gains and economic growth • Opportunities for tackling important social challenges • Improvement of the functioning of government • Increase service levels • Quality and timeliness of policy making • Better enforcement 3 Ministry of Economic Affairs 22 September 2017

  4. Digitalisation has an important impact on public interests • Obviously, digitalisation also has an important effect on different public interests • A long list of questions around different issues (non-exhaustive): o Privacy o (Cyber)security o Fair competition (dominance, level playing field) o Reliable and open information (fake news, filter bubbles) o Data-ownership, control and access (more on this later on) o Ethics (discrimination, human dignity, autonomy) o Consumer protection (and small businesses protection?) o Digital skills (students, but also citizens/employees?) o Impact on labour market o Tax collection 4 Ministry of Economic Affairs 22 September 2017

  5. A simple framework: digitalisation changes the roles of government Threats 4. Limited availability of 1. Public interests necessary under pressure production factors Public Market sectors sectors 2. New ways to 3. Increase protect public productivity in interests, better public sectors regulation Opportunities 5 Ministry of Economic Affairs 22 September 2017

  6. Focus on the interaction between public interests, technology and digitalisation in important sectors 6 Ministry of Economic Affairs

  7. Outline I. The importance of digitalisation and what it means for the role of government II. Questions around data-ownership, data-access and control III.Outlook for the Dutch economy 7 Ministry of Economic Affairs 22 September 2017

  8. Data has some special characteristics – it is different from oil • Data is non-rivalrous but excludable • Data is a capital with increasing returns • Due to increasing relevance of data there is a variety of policy questions around them o Privacy (data protection) o Data-ownership, access and control o Cybersecurity o Competition o … 8 Ministry of Economic Affairs Partly based on presentation by Christian Reimsbach-Kounatze (OECD), Enhanced access to data, Data Access and Transfer – EC workshop (June 8)

  9. A very simple data chain to structure the different issues Overview on next slide Collection Possession/control Utilization • investment in sensors, • de facto control • aggregate software, networks • legal protection • combine • analytics • Questions on unwanted data collection Access Utilization (re-use) • Privacy/ data protection and cybersecurity • compulsory: regulation • aggregate • Examples: smart home devices, • voluntary: contracts • combine security cameras, commercial • analytics cameras with facial recognition, WiFi-tracking in shops, etc. 9 Ministry of Economic Affairs

  10. ‘Data ownership' is an umbrella for different kinds of questions Data ownership, control and access 1. Data silos 2. Data control 3. Data access for 4. Open data policy making and enforcement Typical questions A. How can data be How can a citizen or Which datasets can What government used better outside of company control "his / government bodies data can made open? the current data chain her" data held by use for carrying out And under which or outside of a another party? their tasks? And conditions? particular company? under which conditions? Open scientific B. Are crucial data Do governments have data/research? sets exclusively sufficient access to controlled by a few data from private large firms? undertakings? “Breaking down data "7 Tools that let uou “How Airbnb routinely “Overcoming 5 silos” control your own data“ hoodwinks your city” barriers to open Examples government data” “Internet companies’ “The land grab for “Government 'blocked' control of data gives farm data” from accessing Twitter “The open-data them enormous data to help spot revolution has not power" terrorist plots” lived up to expectations. But it is 10 Ministry of Economic Affairs only getting started”

  11. We don’t need new ownership rights for data? • A traditional intellectual property trade-off • No need for an exclusive ownership right for businesses? o Lots of investments in data collection o Access to data can be made exclusive by technical means • Data protection (privacy) regulation already provides data control rights for citizens • But the current legal framework is complex o Results in missed opportunities for data-sharing in B2B- context? 11 Ministry of Economic Affairs

  12. Do we have the right framework to evaluate when to regulate access to data? We regulate access to data for competitors in some specific • sectors and cases Should be evaluated at sectoral level • When to regulate access and when not? Need for a better • (economic) framework? 12 Ministry of Economic Affairs

  13. Outline I. The importance of digitalisation and what it means for the role of government II. Questions around data-ownership, data-access and control III.Outlook for the Dutch economy 13 Ministry of Economic Affairs 22 September 2017

  14. Gross domestic product is picking up firmly… Billions of euros in volumes 720 700 680 660 640 620 600 580 560 '08 '09 '10 '11 '12 '13 '14 '15 '16* '17* '18* 14 Ministry of Economic Affairs 22 September 2017

  15. … with quarterly growth accelerating (quarter-on-quarter, percentage change) 1,6 1,4 1,2 1 0,8 0,6 0,4 0,2 0 '14 K2 '14 K3 '14 K4 '15 K1 '15 K2 '15 K3 '15 K4 '16 K1 '16 K2 '16 K3 '16 K4 '17 K1 '17 K2 15 Ministry of Economic Affairs 22 September 2017

  16. Annual growth is projected to be broad based… 4 3,5 3 2,5 2 1,5 1 0,5 0 -0,5 -1 -1,5 '13 '14 '15 '16 '17* 18* Consumption Exports Gross fixed capital formation GDP growth 16 Ministry of Economic Affairs 22 September 2017

  17. The unemployment rate is declining steadily… Dashed line = CPB forecast 8 7 6 5 4 3 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 17 Ministry of Economic Affairs 22 September 2017

  18. … and firms are having more difficulty attracting personnel % of firms where lack of personnel is limiting production 18 16 14 12 10 8 6 4 2 0 '12 '13 '14 '15 '16 '17 18 Ministry of Economic Affairs 22 September 2017

  19. Government debt (left) and deficit (right) are improving steadily Percentage GDP, dashed line = CPB forecast 70 2 68 1 66 0 64 -1 62 -2 60 58 -3 56 -4 54 -5 52 -6 50 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 19 Ministry of Economic Affairs 22 September 2017

  20. The outlook for the Netherlands compares favourably to our peers 2016 2017 2018 Percentage GDP NL EA OECD NL EA OECD NL EA OECD GDP 2,2 1,7 1,8 3,3 1,8 2,1 2,5 1,8 2,1 Private consumption 1,6 1,9 2,3 2,2 1,4 2,1 2,4 1,4 2,0 Gross fixed capital formation 3,1 3,4 1,3 6,3 3,4 3,2 4,8 3,3 3,1 Exports 4,3 n.a. 2,3 4,9 n.a. 4,2 4,5 n.a. 3,9 Imports 4,1 n.a. 2,7 4,5 n.a. 4,4 5,1 n.a. 4,0 Government financial balance 0,4 -1,6 -3,0 0,6 -1,2 -2,8 0,8 -0,9 -2,7 Government debt, maastricht def. 61,8 91,7 n.a. 57,2 90,4 n.a. 53,7 88,9 n.a. Unemployment (% labour force) 6,0 10,0 6,3 4,9 9,3 6,0 4,3 8,9 5,8 Source: OECD Economic Outlook June 2017, CPB Netherlands bureau for economic policy analysis 20 Ministry of Economic Affairs 22 September 2017

  21. Risks to the outlook..? • Generally tilted to the downside: o Uncertainty about exit quantitive easing o Brexit may hurt the Dutch economy via trade o Geopolitical tensions (i.e. North-Korea) o Future course of American trade policy o Uncertainty about growth in China • To the upside: o Further strengthening of growth in the Eurozone and the US 21 Ministry of Economic Affairs 22 September 2017

  22. Annex 22 Ministry of Economic Affairs 22 September 2017

  23. OECD framework on data openness 23 Ministry of Economic Affairs Source: presentation by Christian.Reimsbach-Kounatze (OECD), Enhanced access to data, Data Access and 22 September 2017 Transfer – EC workshop (June 8)

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